House of Commons Hansard #99 of the 39th Parliament, 1st Session. (The original version is on Parliament's site.) The word of the day was seniors.


Canada Pension PlanGovernment Orders

11:10 a.m.


Jean-Yves Laforest Bloc Saint-Maurice—Champlain, QC

Mr. Speaker, I thank my colleague for her question. The Bloc Québécois has indeed made the question of retroactivity a priority.

I would point out again that the elderly are one of the most vulnerable groups, as the member explained. They are vulnerable, first, because of pressure from society and from government bodies. That pressure means that for them it is very often much too complicated to file applications. They always imagine that they are not entitled, that they will not be covered because of some exception. Often, because of bad experiences they had in the past, their first reaction is not necessarily to seek out people to help them, in order to get access to money that would help them, in this instance the guaranteed income supplement.

It is extremely important—to point this out one more time—to provide them with full retroactive payment. In fact, these people were entitled to that money for a number of years and did not receive it. We know that money is important, particularly for older people, who are much more fragile. Obviously, we talk a lot about the health of older people. Their health is much more fragile, and often having better income also has a positive impact on their health, because they are able to obtain additional services. Sometimes, because they do not have the income they need, some seniors will go without medications when they need them.

That is one more reason for the guaranteed income supplement to be paid to everyone entitled to it, obviously, but also for it to be paid retroactively to people who were entitled to it for many years.

Canada Pension PlanGovernment Orders

11:10 a.m.

Blackstrap Saskatchewan


Lynne Yelich ConservativeParliamentary Secretary to the Minister of Human Resources and Social Development

Mr. Speaker, I would like to thank you for the opportunity to speak to Bill C-36.

This is an important legislative proposal, the amendments to the Canada pension plan and the Old Age Security Act. I wish to speak to the impact of the proposed changes to the Canada pension plan for people living with disabilities in Canada.

Canada's new government understands the need to ensure that people living with disabilities are given the support that they need. People with disabilities are our friends, our families and our constituents.

We campaigned and were elected on our commitment to stand up for Canada. Canadians were offered the priorities of our Conservative government and found that we hold all the same values dear. We all want a government that makes careful use of public resources to ensure that they are there to help our families and friends who need it.

The new government is getting things done for our friends and for our families with disabilities. For instance, budget 2006 committed enhanced assistance for persons with disabilities. This was done by increasing the maximum annual child disability benefit to $2,300. We expanded the eligibility for the same benefit. We boosted the maximum refund for the medical expense supplement to $1,000, and HRSDC has put together labour market agreements and the opportunity fund for persons with disabilities.

Canadians want what we are all looking for. We want a government that understands that the federal government and provinces need to work together constructively. Canadians can take heart. The legislation comes as a result of a healthy and renewed relationship that our new government has forged with our provincial partners.

Most Canadians recognize the importance of the Canada pension plan to their income security. Along with old age security, the Canada pension plan provides Canadians with the foundation upon which to build their retirement income. Together, Canada's public pensions deliver about $54 billion in benefits to Canadians every year.

However, the Canada pension plan is much more than a retirement pension. Through its disability program, the Canada pension plan provides basic coverage to approximately 295,000 Canadians with severe and prolonged disabilities and to 90,000 of their children. Indeed, the Canada pension plan is considered the largest long term disability insurance program in Canada.

Every three years the ministers of finance review the Canada pension plan to ensure that it remains financially sound and to make any necessary adjustments. The triennial review also provides an opportunity to see that the Canada pension plan evolves to meet the changing needs of Canadians throughout their lives. It also exemplifies that the CPP's accountability and transparency is there for Canadians.

The most recent review, completed in June, confirmed that the Canada pension plan is on solid financial footing, but the review also showed that together we could all do a better job of recognizing contributors with long term attachment to the workforce by making their CPP disability benefits more accessible.

Federal and provincial finance ministers understood that it was time to address an issue that has been raised as a concern by people living with disabilities, their representatives and members of the House. The ministers listened to the people who came to them. They took on the issue. They showed leadership that had been lacking by pursuing this change.

There has always been a minimum qualifying period for CPP disability benefits since they were first issued in 1970. Over the years this qualifying period has been amended on several occasions. For example, from 1987 to 1997, applicants needed contributions in two of the three years or five of the last 10 years to qualify for disability benefits.

In 2003 Parliament heard from long term contributors who were ineligible for benefits because of the change requiring contributions in four of the last six years that was introduced in 1998.

What followed was a report prepared by the chief actuary regarding Canadians with a long history of workforce attachment and who were denied CPP disability benefits on the grounds that they had insufficient contributions. The study found many of these applicants had contributed for two or three years of the minimum qualifying period but had not done so for a fourth year. Without that fourth year of contributions they could not qualify for benefits under the existing rules despite in some cases more than 30 years of overall contributions.

Imagine a woman who has worked steadily for 25 years and has contributed faithfully to the Canada pension plan, including for three of the last six years. She feels that these substantial contributions will give her access to disability benefits when she needs them. Suddenly a major medical condition takes her out of the workforce and then she discovers that she does not qualify. She needed to contribute to the CPP for one more year before she could qualify. Imagine her sense of disappointment and frustration. Despite her lengthy contributions to the Canadian workforce her Canada pension plan disability benefit was not there for her when she needed it.

As I said at the outset, Canadians elected Conservatives to stand up for them. They elected us because they knew we understood them and their concerns. We were elected by Canadians because they knew we would get things done and we are getting things done. The government is acting to ensure that thousands of Canadians who are long term contributors to the CPP are not left alone to fall through the cracks. We stand with them and we are standing up for them.

I am pleased to say that Bill C-36 is a positive response to the desire for greater fairness expressed by the Minister of Finance. It is an obvious response to the needs of persons with disabilities whose concerns were too long ignored.

Under the proposed legislation, applicants with 25 or more years of contribution would become eligible for benefits if they contributed in three rather than four years. All other applicants would still have to make contributions in at least four of the last six years and of course all applicants must still meet the medical eligibility requirements.

What does this legislation mean for Canadians? It means an additional 2,000 long term contributors with severe and prolonged disabilities would be eligible to receive benefits by 2008. By 2010 the new beneficiaries could total about 3,700. Close to 1,000 children of these beneficiaries could also receive benefits.

Through this legislation the Government of Canada is sending an important message to long term contributors to the Canada pension plan who are forced to leave the workforce because of a severe and prolonged disability. It says that Canadians have told us that the current disability program does not meet their needs. It says that we have heard their concerns and we are acting on them.

This legislation is part of the government's commitment to greater accountability and to action that restores the public's trust in government. It says the government balances the social needs of Canadians within an accountable and transparent fiscal framework. The legislation change is fully affordable at the current CPP contribution rate and will not compromise the financial sustainability of the plan.

It pleases me that other members of the House are in fact agreeing to support this important bill that will help our Canada pension plan. It also tells me that everyone, along with our new government, understands that seniors have made contributions and continue to make huge contributions to our country. Seniors know that Conservatives and the House share the same values and concerns as they do, and that these are the values and concerns of all Canadians. We all understand that sometimes the world changes and that we need a government that will ensure that seniors are not left behind.

We recognize a commitment to the Canada pension plan, old age security and the guaranteed income supplement as fundamental guarantees of income security in retirement years. We promise to ensure that seniors have the respect and integrity that they deserve. Our pension plan has been integral in dramatically reducing the level of poverty among seniors. Back in 1980 almost 21% of seniors lived on low incomes. Today, because of changes that were made, we have reduced that number to less than 6%.

To address presently changing needs of seniors, we are making significant investments across a full range of seniors programs, from health care to housing, from retirement savings programs to assistance for caregiving. We have shown support in budgeting for seniors: $64 billion a year on programs for seniors, including our public pension programs.

Our public pension programs are something Canadians can rightly take pride in. Our public pension system is recognized worldwide as one of the best. It plays a vital role in ensuring the economic well-being of thousands of Canadians.

Today seniors are generally healthier, better educated and economically better off than in previous generations. Today's seniors are looking for new ways to contribute to their country. Seniors work longer, volunteer more, and play an active role in the communities across Canada.

As the baby boomer generation marches toward retirement, we need to take steps to prepare for the growing number of seniors. I am one of those baby boomers and I am concerned that in the next 25 years nearly one in four Canadians will be a senior citizen. The aging of our population means that we cannot take our cherished public pension programs for granted.

We understand that the future of these programs is a matter that affects all Canadians. This is why our new government is strengthening our social foundations. Standing up for seniors mean ensuring these programs are there for seniors now and in the years to come. As well, Conservatives and all Canadians understand that the retirement income system, the Canada pension plan and old age security are key pillars of Canada. These pillars must be maintained and cared for if they are to be counted on to maintain and care for the needs of Canadians.

Something also important to Canadians are the changes proposed in the bill that will improve the way governments administer pension programs. Together these amendments strengthen fairness and accountability. In the past, concerns have been raised that eligible seniors may not be receiving the guaranteed income supplement because they were not aware of the program and did not apply. Much has been done already to remedy such situations. This legislation, however, goes one step further.

To explain, under the proposed changes seniors apply for GIS at the same time as they apply for old age security. No separate application form would be required. In addition, as long as seniors file a regular tax return they will automatically receive the GIS benefit in any year they are entitled to. They would never need to reapply. This cut in red tape makes sense. It is the kind of sensible thinking that our new government has put into creating “Advantage Canada”. In a nutshell, it means that all eligible seniors should receive the GIS as long as they file a Canadian tax return.

The same sensible thinking is what led our new government to propose amendments to the Canada pension plan that are found in the bill that I spoke about earlier, making it easier for long time contributors to qualify and working Canadians who are attached to the workforce. Canadian seniors, men and women whose hard work helped build this country, deserve to have a government that stands up for them and I am proud to be a part of this government. I am proud that we are taking steps to put in effect the existing full funding provision of the Canada pension plan.

The new provision adds transparency to the existing provision, which requires any changes to the plan's benefit be paid for in full so their costs are not passed on to the future.

This is what Canadians want to know, that CPP is on sound, financial footing now and for future generations. This change would help get that done.

Our new government will also be modernizing service delivery, to ensure electronic services for pensions are available for seniors across the country, a simple, practical thing in this modern age of technology. However, a change to the legislation was needed to enable seniors to apply for benefits online.

These amendments would also close loopholes and prevent misrepresentation, which ends up costing all taxpayers.

Enhancements to our retirement income system are one of the ways we are helping to improve the quality of life for Canadian seniors. As I said earlier, the government is doing even more. Let me give a few quick examples.

We are reaching out to seniors across the country, thanks to our new horizons for seniors program. Through this program, we are helping to harness energy, skills and leadership of seniors and projects that make a difference in their communities. Consider the grandfriends program in Prince Edward County, where seniors are giving back to their community by acting as storytellers to children.

Canada's new government promised new measures to provide tax breaks for older Canadians, and we got it done in budget 2006. Starting in 2007, seniors couples can split their pension income. We increased the age credit amount by $1,000 to $5,066, retroactive to January 1, 2006. We doubled the amount of eligible pension income that can be claimed under the pension income credit from $1,000 to $2,000, starting this tax year.

Through these tax measures, we are putting back into the pockets of our seniors who have already contributed to so much in our country.

Our new government is standing up for those who have spent their lives raising families, saving for their retirement and building up our nation. We are standing up seniors because we are committed to protecting what is great about Canada.

With the proposed amendments in Bill C-36, we will are helping to ensure that all Canadians, young and old alike, can rely on the Canadian pension plan and old age security as key pillars of their retirement income.

This important matter crosses party lines. I am happy and pleased to say that everyone in the House wants what is best for seniors. That is why I am thankful that hon. colleagues in the opposition, along with us, have given their stamp of approval to this important legislation.

Canada Pension PlanGovernment Orders

11:30 a.m.


Robert Carrier Bloc Alfred-Pellan, QC

Mr. Speaker, several of my colleagues have previously drawn attention to the extreme poverty in which most seniors live. Very often this poverty is caused by the fact that they do not even know they are entitled to a guaranteed income supplement.

At present, there is a bill tabled before this House. This bill is designed to correct certain imperfections in the current law. I listened carefully to the presentation by the Parliamentary Secretary to the Minister of Human Resources and Social Development and the member for Blackstrap.

I would like her to explain why this bill, which aims to correct an injustice, does not go so far as to ensure real justice by granting full retroactivity to those who in any case will realize they were entitled to the guaranteed income supplement.

The bill limits retroactivity to just 11 months. By what accounting or human logic can the present government place this limit on retroactivity? As many have pointed out, when money owed by citizens or businesses to the government is involved, retroactivity is full, regardless of the number of years the government has been owed the debt. Can she explain to me what human logic and sentiments are behind this limit on retroactivity?

Canada Pension PlanGovernment Orders

11:30 a.m.


Lynne Yelich Conservative Blackstrap, SK

Mr. Speaker, I like to think that we are talking about prudence in our public coffers, how money is spent and how programs are delivered.

Our chief actuary estimates that the number of beneficiaries will double by 2030, I believe. The old age security program is not supported by contributions. It is supported by the public purse, by the general revenue. It is $28 billion per year, which is 14% of our total government expenditures.

Think of a program of taxpayers dollars coming out of general revenue. If we put that in perspective, I would think that we are doing this in the best interests of the people who are paying into that fund. To compare it to the government trying to collect taxes is a little different. Those taxes are being paid into that fund and those persons are getting out of paying into something that they rightfully owe, and that is their taxes to the general revenues.

I would hardly compare those two, but I would try to put in perspective what this costs us. It is quite generous to go back one year because the guaranteed income supplement is calculated in the current tax year. I would like the member to think about it before we talk about retroactivity any more. I would like him to think about what this would mean.

Why would we spend our resources and time trying to go back? How many years would we go back? How many of these people would still qualify or would have just qualified for one year? All the work that we would have and the resources to go into that would in fact be better spent by continually trying to find good programs and provisions in the act. Some of these changes are going to cost us some dollars and some tax money.

I hope he will understand this. We talk about old age security and guaranteed income supplement. When we talk about the general revenue, 14% of the general revenue is spent on old age security, or $28 billion a year.

Canada Pension PlanGovernment Orders

11:35 a.m.


Catherine Bell NDP Vancouver Island North, BC

Mr. Speaker, I have heard the concern from other members of the House this morning on what they see in their communities with regard to seniors living below the poverty line and the hardships they are facing.

I am glad the parliamentary secretary feels that the Conservatives were elected because they understood the concerns of seniors and that they did not want to see any seniors left behind. However, as we have heard from other members, seniors are falling through the cracks, and I have seen this myself.

We know that women who earn less then men are doubly impacted. Aboriginal women even earn less so there is a double whammy for them.

When I read that about a quarter of a million seniors are living below the poverty line, there is nothing in increases in income for the OAS and GIS. Could the parliamentary secretary tell me if the government will be increasing the supplements to seniors so they can live with dignity and have a better opportunities? We know that living in poverty also creates more health problems.

Could the parliamentary secretary commit that the government will raise the OAS and GIS for seniors?

Canada Pension PlanGovernment Orders

11:35 a.m.


Lynne Yelich Conservative Blackstrap, SK

Mr. Speaker, I started to articulate earlier about some of the scenarios that had been put before us today on some of the conditions in which seniors live. Many of these conditions are the result of poor management on the part of provincial governments.

I just came off a three week tour of my riding of Blackstrap. I went through senior citizens homes in rural Saskatchewan. Hospitals are being closed. We are not being heard in rural Saskatchewan. Our province seems to be ignoring this. This is why I hope we can pass legislation like this to at least do what we can. The federal government can only do so much for these seniors. Some of the conditions seniors in Saskatchewan are living in today are the result of very high medical costs in the province. Some drugs are not covered. Some of our hospitals and senior residences are closing. Some people are being taken out of their communities.

One of the official opposition members said yesterday that sometimes seniors needed support. It is not all about money. Some of it means good community support. I would like to take every member of the New Democratic Party to Saskatchewan for a tour to see how some people live under the NDP government there. I am trying to put some stories together to show that it has ignored its seniors and its people.

The federal government is listening and we are--

Canada Pension PlanGovernment Orders

11:40 a.m.


The Deputy Speaker NDP Bill Blaikie

I am sorry to interrupt the member, but we have one more question we want to fit in.

The hon. member for Chambly--Borduas.

Canada Pension PlanGovernment Orders

11:40 a.m.


Yves Lessard Bloc Chambly—Borduas, QC

Mr. Speaker, I invite the member and parliamentary secretary to actually answer the question from the member for Alfred-Pellan.

I am disconcerted to see that when she is asked why the Conservative government refuses to pay the guaranteed income supplement to seniors—to which they are entitled retroactively—she answers that we have to be careful with public funds. This is quite disconcerting.

The primary function of the guaranteed income supplement is in fact to be careful with the finances of our most disadvantaged citizens in order to help them. That is something she is not taking into consideration.

This was a right and it is still a right. This right should be retroactive because seniors have been deprived of it. Owing to their isolated situation, they have remained unaware of this right.

I would like the parliament secretary to answer the question properly. If she does not do so, I invite her to listen again to what she said, because it does not make any sense.

Canada Pension PlanGovernment Orders

11:40 a.m.


Lynne Yelich Conservative Blackstrap, SK

Mr. Speaker, I am not sure how far back they want to go, but we do offer retroactivity. This has been done in a prudent manner and with the good guidance of the finance minister. Our department is doing what is prudent with retroactivity. The program is trying to duplicate what is done in other provinces. That is what retroactivity does. It is in the best interests of those who make the decisions on retroactivity.

When the member talked about retroactivity, I understood him to say that it would go back a long time. I do not think that would be possible. How far back would one want to start retroactive payments? We do that already. We are trying to look forward. We want to ensure this does not happen again. The positive parts of the bill will make it so this never happens again.

I invite the member to help us ensure it does not happen again by finding a way to reach those people who are not registered through the income tax system. If the member could help with some solutions--

Canada Pension PlanGovernment Orders

11:40 a.m.


The Deputy Speaker NDP Bill Blaikie

Order. Resuming debate, the hon. member for Montmagny—L'Islet—Kamouraska—Rivière-du-Loup.

Canada Pension PlanGovernment Orders

11:40 a.m.


Paul Crête Bloc Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC

Mr. Speaker, there are days when what we do in this House is agreeable and other days when it is less so. Today, I believe we are having a positive and constructive debate on this legislative measure. Several years ago, I saw the Bloc Québécois member for Saint-Maurice—Champlain, Marcel Gagnon, take the offensive against a federal government that was very insensitive in dealing with this question of the guaranteed income supplement.

Let us remember that it was discovered that 272,000 people in Canada, including about 68,000 in Quebec, were not receiving the guaranteed income supplement, not because they were not eligible for it, or because they had been denied it, but because they had not been given the means to apply for it. This was the result of the somewhat obsessive war on the deficit.

The rules for employment insurance were tightened considerably, such as an increase in the number of weeks to qualify for benefits, a reduction in the number of benefit weeks to which people are entitled, and a reduction in the percentage of benefits, and this was done to take money out of the pockets of the worst off in order to pay down the federal deficit. The federal government also used the guaranteed income supplement for the same purpose.

This whole scandal was brought out into the light of day and Mr. Gagnon, along with all the Bloc members, set out on a tour of Quebec. We organized meetings in senior citizens clubs and with the Association québécoise de défense des retraités. We also held meetings with younger people who realized that their parents did not have access to this program because they did not have the information they needed. It was then that we realized just how terrible the situation had become. It took some time for the federal government to react.

In contrast, there are some issues on which the government acts much more quickly. When we owe money on our income tax, for example, the government reaches as far back as five years to recover the money that is due. However, when the federal government owes money to older people for the guaranteed income supplement, the maximum retroactivity is 11 months.

Once again today, in the debate on this bill, which will improve the situation on a number of counts, full retroactivity is still being denied, not to people who are 30, 35, 40 or 50 years old but to people who have contributed to our society throughout their whole lives, people who often are in very difficult personal situations.

Speaking about people who found themselves in this situation—and I recall meeting some—they were, for example, women who had never worked outside the home and whose husbands assumed responsibility for all financial matters, women whose husbands brought home the pay cheque and who were left with nothing when their husbands died. For many years, these women were not entitled to the guaranteed income supplement, although they would have been if we had only instituted an automatic assessment of their rights a few years ago. Often they have lived three, four, five or eight years in unacceptable poverty. If we had only taken the attitude that the guaranteed income supplement should be paid to anyone who needs it, if our policy had been based on that philosophy, we would not be here today discussing this bill. At least we can say now as parliamentarians that, even though it is many years late in coming because of the federal government’s slowness to institute changes, we are finally going to correct part of the problem. The automatic calculation feature will really help to correct the situation and ensure that people receive the guaranteed income supplement in due course.

What is the guaranteed income supplement for the people who are listening to us and do not know? There is an old age security program in Canada to provide an income to people who have reached 65 years of age. In addition, the guaranteed income supplement was developed for people who have no income other than this federal government income because we know very well that the basic amount is not enough for today’s cost of living. Even with the guaranteed income supplement, I can assure the House that people who receive the maximum are not wasting it. Fortunately, our seniors are accustomed to economizing and they manage ultimately to reach a satisfactory standard of living. There has been an improvement in the income of older people in comparison with 60 years ago. There has been an increase and that is very good because these people really deserve it.

However, a few corrections are in order. I would like to give you an example of something that does not appear in the bill. I realized that there was a problem, a fundamental flaw, in the indexing formula for old age security. It is calculated on the basis of a basket of goods and services purchased by the average Canadian consumer. Seniors have expenses that most people do not. They have to buy special equipment for their homes. For example, they may need an additional handrail in the bathtub.

There are other kinds of expenses, such as the cost of medication and alterations to the home. Many of these expenses far exceed the nominal inflation we see happening today. If old age security is indexed at 2%, that means people will systematically be losing money. Yet they adapt. It can be very frustrating to receive a cheque for $.55 or $1.05 more every three or six months while at the same time, the extra bills come in for medication, unexpected health issues or a death in the family. All such situations must be taken into account, and I would like the federal government to study this matter.

Instead of determining the inflation rate based on a conventional basket of goods and services, the government should use a special basket for seniors. This would ensure indexing that corresponds to the increase in their cost of living, not that of average Canadians. This bill aims to improve a number of things in this regard. It is pretty good, but it should go further. One good thing about the bill is that it mentions ongoing renewal, clarity of legislation and waiving the requirement for a renewal application for the guaranteed income supplement and allowance benefits once an initial application has been made.

In contrast to many government programs, people who may be 75, 78, 80 or 85 have to reapply each year. We will change that. It makes no sense that it has taken five years to reach this point, but the bill before us will at least take care of that. The bill also contains provisions to ensure that the legislation is clearer and more consistent and to reflect its true intent. This means that this was not done in the past. As my colleague said earlier, the true intent of the legislation is to provide income for people who have no other source of income and who absolutely need that money to live. The legislation is not intended to save the government money; it is not intended to pay people as little as possible; it is intended to give people what they are entitled to. We hope that the legislation will reflect this intent. There is also a need to simplify the reporting of income for couples and seniors.

For example, for seniors who apply for income-tested benefits and who have suffered a loss of income due to the termination or reduction of employment or pension income, this change would facilitate the application process by requiring that seniors report estimated pension and employment income only. This means that there will be a sort of safety net when unforeseen circumstances arise, so that we can make adjustments during the course of the year. Often, in practice, seniors are faced with a sudden expense. They withdraw money from an RRSP to pay it, and this amount is added to their income for the previous year, which reduces the amount they receive in the current year. We regularly see such cases in our riding offices, and we need to find ways to make the program more flexible, so that people are not penalized by such situations.

Spouses will no longer be required to provide marital and income information that has already been provided by their spouse or common-law partner. In practice, there will be one less obstacle. However, this transmittal of personal information must be carried out properly. With past practices, caution was required to ensure appropriate processing. What happened with the guaranteed income supplement also occurred with American pensions. As I was explaining earlier, it was during the same period where as much money as possible had to be collected and as little as possible was to be disbursed.

That was the 1994-95 period, under the former Liberal government. At that time, it was decided that an additional tax would be applied to American pensions. In the end, citizens in the same situation were penalized.

This situation has yet to be corrected. I hope that the federal government will examine this issue in the coming weeks and months so that justice may also be served for these individuals.

The Bloc Québécois believes that Bill C-36 will make it easier for disadvantaged seniors to access the guaranteed income program by providing for automatic renewal of guaranteed income benefits to couples on the basis of a single tax return. This is an interesting aspect of this bill. It is one of the reasons why the Bloc Québécois will support this bill.

The bill will allow seniors who have had a sudden drop in their employment income or their retirement income during a fiscal year to apply for the guaranteed income supplement based on an approximate statement of their employment and pension incomes. As I was saying earlier, this is another positive point. In a way it provides a credit or evaluation opportunity during a year when a senior's financial situation suddenly deteriorates. The situation can be adjusted immediately rather than waiting until the following year. What people buy with their old age security or guaranteed income supplement cheques is real. They are not stashing it away. This money is for covering daily expenses.

It can be shocking to go into homes or residences where seniors live in Quebec and Canada to see how people have to come up with small miracles to make ends meet with the money they receive. If there is a sudden change in their income or an unexpected expense in the family, for the couple or the person living alone, that is a major problem. The bill provides another positive aspect in that regard.

The bill also clarifies some sections of the Old Age Security Act in order to correct inconsistencies. This is also important. It also makes changes to the Canada pension plan. This does not affect Quebec or its constitutional responsibilities in any way. We are being vigilant and want to ensure that Quebec's jurisdictions are protected.

Generally speaking this is a bill that will improve the situation. However, there are a certain number of items we would like to go over in committee, unless the government comes back with another bill. The first item is the way this bill broadens the restrictions on immigrants who are new Canadian citizens. We will have to look at the impact of such a measure because the Bloc Québécois cannot agree to having different classes of Canadian citizens, regardless of their journey to get here.

In this case, we are talking about sponsored immigrants, that is those who were able to come here with the help of a sponsor. Under the bill before us, there could be situations where the income provided by the sponsor could be taken into account in the calculations with regard to the guaranteed income supplement while, technically, I think the person should simply be deemed entitled to the GIS. People who act as sponsors are not all millionaires.

Immigration here often means that a factory worker brings his father or his mother to this country. The person settles here and meets the eligibility requirements with regard to the number of years for example. At some point, if the money provided by the sponsor has to be taken into account in calculating the guaranteed income supplement, it penalizes the sponsor. In some way, the senior's personal situation is actually hurting his or her family's situation. I think this issue could be addressed in committee.

There is another aspect that was raised several times by my colleagues and that really needs to be addressed by the government. It is the last key element needed to make the system totally fair, and I am talking about retroactivity. Currently, retroactivity is limited to 11 months. Why 11 months for the guaranteed income supplement and five years for taxes owed to the government? This double standard is unacceptable.

The parliamentary secretary mentioned earlier that sound management of public funds will be a factor. That is the same argument that was used by the Liberals when they did not want to make changes to the GIS.

They argued that doing the automatic calculation every year would involve significant costs and that they did not know what they would amount to, and that we had to be careful.

As a result of pressure, the representations made by the political parties and the initiative of the Bloc Québécois, that argument was refuted with regard to automatic calculation. The question of retroactivity should now be dealt with in the same way. Let us be honest: the only reason why the government is refusing to do this is that it will have to pay out large amounts of money to make up for the negligence of the system.

An injustice or inequity must not be tolerated simply because a significant expense will be incurred. If there are errors that result directly from automatic calculation and a person is entitled to retroactive payment for a number of years, it would be entirely reasonable for retroactive payment to reflect a five-year period or the maximum period. If the right thing is done properly and at the right time, instead of being 11 months it may be 14 months, 18 months or two years. It may not be as drastic as that in all situations. There is a way of developing a system that is tight enough that the overall cost will not be too high at the end of the road.

What we have today is the result of the rather disastrous management of the past.

At present, in terms of retroactivity, there is certainly a larger amount owing. I think it is on the order of $3 billion for all of Canada. However, if the system is managed properly and we go ahead with a tight system, that amount will decline and it will be much lower in the years to come. This is therefore an important factor.

The Bloc Québécois will take the opportunity offered by debate on this bill to continue its battle and to tell seniors that they should be entitled to this retroactive payment. Yes, we are going to continue working to ensure that everyone who is entitled to the guaranteed income supplement is able to receive it.

This system was developed in Canada to enable these people to receive a certain amount of money, but it also helps to keep the economy going. We have to remember the time when neither the old age pension nor the guaranteed income supplement existed. People did not live nearly as long. Some people's lives involved much greater hardship than they do today. Part of that situation has been remedied. Now, we must continue to improve the system. That includes retroactivity and appropriate indexation for seniors.

We must examine more thoroughly the poverty issue of women living alone, for example, or when one of the spouses dies. When the husband dies and the wife remains alone, the surviving spouse must suddenly face major additional expenses.

Is the current survivor's benefits program adequate? Could an additional effort be made? We must examine these conditions as a whole. The bill we are debating today will not resolve all these issues. However, the committee must feel very comfortable about broadening these recommendations to make suggestions along these lines.

Concerning the expansion of the third party group to which the contributor's personal information could be provided, we must ensure that the testimony of the Privacy Commissioner is heard.

The Privacy Commissioner will have to examine the best way to ensure that personal information can be provided to various government stakeholders. Does this respect the protection of personal information? Does the individual give his or her authorization? To what does he or she give it? How will it be used? We will have to ensure that no action exceeds the limits.

The provision of personal information collected in the guaranteed income supplement reports and the direct link with the taxation agency must not be made to the detriment of the individual, and the latter must be informed of the type of exchange. We will then be able to guarantee that statistics will not be used improperly. The changes to regulations must not limit access to the guaranteed income supplement. The Bloc will keep a close watch on this.

Automatic assessment is very nice, but some sort of regulation before approval should not make qualification more complicated. We will follow this closely, because our seniors deserve that respect. There must be a spirit and a policy.

I will conclude by saying that this has been a long-fought battle. Marcel Gagnon, a former member of the Bloc Québécois, did extraordinary work on this issue. Today, he must be pleased that part of the result has been achieved, but he expects an equal measure of fairness on the retroactive side. Thank you.

Canada Pension PlanGovernment Orders



Ed Fast Conservative Abbotsford, BC

Mr. Speaker, this bill is of special interest to residents in my riding, especially the disability eligibility provisions.

This past month a constituent of mine came to my office and told me a very sad story. He contributed for some 25 years to the Canada pension plan. He was hurt on the job and went on worker's compensation for two years. Of course those two years do not qualify under the total years worked under Canada pension plan. He then struggled to go back to work for three years but was then diagnosed with inoperable terminal cancer. He does not qualify for disability benefits. Now in his waning years he does not have the income that he needs to at least make his life reasonably comfortable. The fact is that this is not an uncommon experience across Canada and many individuals are in the same position.

Since the member and his party seem to support this legislation, is his party also prepared to expedite the passage of the legislation through committee stage, third reading and then through the Senate?

Canada Pension PlanGovernment Orders

12:05 p.m.


Paul Crête Bloc Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC

Mr. Speaker, as I indicated in my speech, and as my colleagues pointed out earlier, the Bloc Québécois is in favour of this bill. We intend to support it. There will be no filibustering tactics to prevent this bill from being adopted. However, I would personally like the committee to hear witnesses on the various issues that I raised, including making retroactive payments to those who should have been receiving guaranteed income supplement benefits over the past two or three years.

My point is the same as the one made by my colleague with his example. If someone who has been making sacrifices for two or three years because his or her income was low—and if that person qualified for the guaranteed income supplement, it is because his or her income was indeed quite low—suddenly finds out that he or she should have been getting the supplement, it seems to me that we should be able to come up with a solution to deal with this situation. The committee could hear witnesses on this issue, and also people with disabilities or health problems. We should ensure consistency among all the government policies, the Canada pension plan or the Quebec pension plan—in the case of Quebec—and the superannuation system. Just because these programs are interrelated does not mean that if we give benefits to one group, we should deprive others from benefits that they are already getting and that they also need.

The Bloc Québécois has taken this issue seriously for many years and has fought very hard for it. One of my best moments as a member of Parliament was to take the initiative of organizing a tour and ask if public servants would come with me and meet people who did not know what the guaranteed income supplement was, even though they should have been getting it. Dozens of Bloc Québécois members did likewise. This enabled us to make very good contact with people who have dedicated their lives to their families, to our society. Whenever we would meet 50 or 60 of these people, there would be two or three or four in that situation. Sometimes, someone aged 33 or 35 would be present at the meeting and would tell us that he or she was going to check things out, because his or her parents were not getting the guaranteed income supplement when they should be receiving it. This kind of positive action has produced interesting results. Today, it is reflected in part in the bill. Consequently, we will support this legislation, but we will expect the government to continue to work to ensure that the program becomes fair in every respect. This will be achieved by ensuring full retroactivity.

Canada Pension PlanGovernment Orders

12:05 p.m.


Yves Lessard Bloc Chambly—Borduas, QC

Thank you, Mr. Speaker.

First I want to congratulate my colleague from Montmagny—L'Islet—Kamouraska—Rivière-du-Loup on his speech in which he aptly outlined all the problems related to income benefits for seniors.

Among all the roles he has played in the House of Commons for the Bloc Québécois, my colleague was at some point responsible for human resources and social development. I know he was very interested in having this injustice corrected for seniors who were entitled to those payments and was very active in that regard.

Earlier, the parliamentary secretary mentioned in her response the complexity of making those retroactive payments as a reason for refusing to make the payments. My colleague mentioned the fact that, in 2001, there were 272,000 people in Canada who had not received those retroactive payments, including 68,000 in Quebec. Having those numbers means that it was possible to identify those people who did not receive the retroactive payments. Therefore, identification is not the problem.

I know my colleague has also examined the whole issue of recovering money owed. For example, when someone has committed a fraud in the past or has inadvertently withheld money from the government, these sums are recovered retroactively and it is often done in entire communities.

Does my colleague believe that it is indeed a problem or are there ways for the government to ensure justice for these people?

Canada Pension PlanGovernment Orders

12:10 p.m.


Paul Crête Bloc Montmagny—L'Islet—Kamouraska—Rivière-du-Loup, QC

Mr. Speaker, I thank my colleague for his question.

Indeed, there remains one door to open. As for arguments such as those of the parliamentary secretary, let us hear no more of them. The government has a responsibility to ensure that its programs are administered fairly.

In fact, 272,000 people were identified. They were not receiving the guaranteed income supplement although they were entitled to it. The same applies to probably some 68,000 people in Quebec. Some of those people were located and a certain number received retroactive payments of up to 11 months when that was possible. However, there are cases where people were owed sums of money covering a period of two, three, four or five years. Had those amounts been paid—it is sad to say—some seniors would have been able to live out their lives with dignity. On that issue, there is no administrative argument for denying that right. We must find ways to make it happen.

If a decision was made to reach agreement in good faith with these people just as the Canada Revenue Agency is prepared to accept a compromise to some degree when someone owes money to it; if the federal government adopted a similar attitude to deal with retroactive claims that would be significant progress.

Let us accept as a starting principle that these people are entitled to retroactive payments and let us provide a retroactive period that is much greater than 11 months. If that happened, seniors in Quebec and all of Canada could consider that they are being treated fairly. Until then, we must continue to ensure that every person who is entitled to the guaranteed income supplement can receive it. We must ensure that this bill deals fairly with the issue of permanent residents. In addition, we must ensure that the next budget contains a statement about retroactivity of the guaranteed income supplement. There is no reason not to do so. The minister has one or two months to think about it.

We could then feel that as parliamentarians we had done our work. It is important to create wealth in a society; but we will be judged on the way that wealth is shared. At present, that wealth is not being distributed fairly. It is being done to the detriment of the most unfortunate members of our society. We have a particular social responsibility on this side and we expect the government to move on this matter.

In any event, on the Bloc Québécois side we have begun the battle. We will continue to fight and we will not let up until the people have obtained justice in terms of the retroactive payments that are owed to them by the federal government.

Canada Pension PlanGovernment Orders

12:10 p.m.


Yves Lessard Bloc Chambly—Borduas, QC

Mr. Speaker, it is my pleasure to speak on this issue today. It stems from a government bill, namely Bill C-36, to amend the Canada Pension Plan and the Old Age Security Act.

We are pleased with this initiative, but only to some extent. As previous speakers have mentioned, this is an initiative to make access to the guaranteed income supplement simpler and more practical by streamlining the process. This is something we have been calling for for many years, but have been systematically turned down by both the previous government and, for the past year, this government.

Because it deals with the old age security program, this bill also affects the benefits paid to pensioners, and particularly the guaranteed income supplement.

A problem arose, which my colleagues have raised, where low income seniors had to meet two criteria: age—they had to be 65 years old—and the number of years of residence in the country. These were the two criteria for applying, provided, of course, they had limited income. In this respect, however, regulations were made, which restricted and, in many cases, prevented access to the supplement.

My hon. colleague pointed this out earlier. In 2001, there were 272,000 people in Canada who were denied access for objective reasons that I will get into later. In Quebec, 68,000 individuals were affected. Our colleague Marcel Gagnon, who was the member for Saint-Maurice—Champlain at the time, fought tirelessly to have more of them receive the supplement, providing them with information about their rights and helping them, naturally, with the appropriate procedures.

The objective reasons I referred to were of the following nature. People were told they had to reapply each year. Many were not even aware that they were eligible for this supplement and, thus, did not apply for it the first year. Others did not know about the requirement to reapply annually.

Which of these people were the most vulnerable? It was those in poor physical health. Often it was also a matter of mental health. And there were actual physical limitations. Among those identified are people who have never worked or who have not filed income tax returns because they did not have any income or so little income that they did not think they needed to file a return. Aboriginals have been particularly affected, as have residents of remote communities, semi-literate people, those who do not read either of Canada’s official languages, persons with disabilities, people suffering from disease and homeless people.

We see that there is a range of people who are, I would say, disabled concerning their obligations to obtain one of their rights. A further complication was added to prevent them from obtaining this right. Over the years, especially since 2001, a major offensive has been led against the previous government for it to correct the situation and, for the past year, against the current government.

So how does that translate into money?

It was between 1993 and 2001 that people began to become aware of the situation—and it continues now, but less significantly. Seniors have been deprived of $3.1 billion. These people are among the most disadvantaged in our society.

What surprises me is that this does not seem to have touched the members of the previous government very much, because they took all those years to make an effort to correct the situation. In the present government we can observe some sensitivity to correcting the situation for people applying now, but no sensitivity for the people who have been deprived of this right. The situation is serious.

I do not want to be too hard on the present government, but when it was in opposition, some of its members were outraged by this situation, just like us. What happens when these people begin governing the country? How do people end up changing their attitude to such an extent? Why, when people are in power and can correct such a large injustice, do they not do so?

The two main political parties in Canada, who have until now taken turns in government, seem to have quite a particular propensity for attacking seniors.

We must also look at the problem as a whole. One of the recurring problems is the lack of will to support older workers who are forced out of the labour force because of massive layoffs.

There was the POWA, the Program for Older Worker Adjustment, but it was abolished in 1997. POWA helped workers aged 55 and over who lost their jobs and were unable to find new jobs for various reasons, the first of which being the unwillingness of employers to show generosity in hiring older workers first. That means that these people cannot find work because of their age. Some of them worked in the same trade for 20, 30 or 40 years and it is not easy for them to learn a new one. Furthermore, an average of 20% of the people laid off these days are 55 and older.

Since 1997, the year the Liberals abolished the POWA, we have been fighting to get an income support program for older workers.

The present situation contributes to the impoverishment of seniors who retired because they reached retirement age or because they were laid off. And here, I am referring to some massive layoffs.

Last week or the week before, the government announced the creation of an expert panel to study the situation. In fact, the government made that commitment last year, during the budget debate.

It was even part of last year's budget amendments. Ten or eleven months ago, the government made the commitment to proceed very quickly with this study and was supposed to report to the House when Parliament resumed after the summer recess.

Despite the fact that, whenever we asked questions about this during the last year, the current minister's predecessor told us every time that the study was underway, that progress was being made and that we would soon see results, we learned a week and a half ago that nothing had been done and that the government was setting up a committee now to do this study. Obviously the House of Commons was not told the truth, and that is a polite way of putting it. We were told something that was not the truth because it was false to say that the study was underway when it has not even started yet.

The second problem with that committee is that workers are not represented. It is made up of representatives of organizations that do not necessarily have that expertise. Surprisingly, the human resources and social development committee toured the country last fall to examine the issue of employability in Canada. One of the issues dealt with at that time was precisely the employability of seniors. How is it that we are being told today that this committee will do exactly the same work without even waiting for the results of the work currently done by our committee, which should be released before we adjourn in the spring?

It is rather amazing to see the extent to which the government will resort to delaying tactics not to honour its obligations to seniors who lose their jobs in massive layoffs. It systematically refuses to provide income support to those people, which tends to confirm what I was saying earlier about this government's tendency to target seniors.

Back to the guaranteed income supplement. It is time for the government to deliver. The parliamentary secretary said that we have to manage public funds carefully. Then she said that it will be very difficult to reimburse the money owed to these people because they are so hard to find. Her statements do not hold water.

The first demonstrates not only a lack of sensitivity but also a lack of empathy toward the poorest people in our society because everyone knows that whatever she says about keeping public funds under lock and key, we have a government that has generated budget surpluses for the past 12 years. On September 25, the Government of Canada announced a $13 billion surplus for the past fiscal year, yet it has responsibilities to seniors who often do not have enough income to pay for basic necessities, such as food, housing, clothing and a reasonable standard of living.

This morning, our colleague from Repentigny shared with us a very moving account of his previous job experience helping these people. He told us about the suffering and the isolation they are forced to endure. This isolation is caused in large part by their low income, which makes it impossible for them to contribute to society in any way.

The parliamentary secretary also said that it is hard to find these people. But if we know how many of them there are, we must know where they are. When it was a matter of finding a way to bring money into government coffers, they had plenty of ideas, plenty of ways to do it. For example, when it came time to bring in the GST and the QST and other provincial sales taxes, they found ways. In Quebec, a harmonized sales tax was implemented. Quebec passes on the Canadian government's share: 6%. Why have we not done something similar for seniors?

Many of these seniors are forced to ask the province of Quebec for help, either through the Quebec pension plan or social assistance. Why is there no agreement? Why have we not considered that the Canadian government could correctly identify these people by their income and that Quebec also had records that could be used to conduct the appropriate verifications to ensure that the guaranteed income supplement is given to those who qualify? Why has this not been done? The answer seems just as clear to me today as in the past. There is a lack of political will, which stems from the ideology of the two political parties, one after the other, an ideology based on supporting the wealthy people of our society and the people who contribute to society by providing jobs.

We know that a minister who temporarily became Prime Minister was able to take advantage of retroactivity for his business beyond the 11 months allowed for seniors. There was no skimping on the number of years and this was done for other businesses, too. When it comes to making exceptions for corporate taxes, there always seems to be a way. The answers we are given do not pass muster and are completely unacceptable in the current context, considering the injustice committed against our seniors.

In closing, I would like to point out that I limited myself to this aspect because my colleagues discussed possible amendments to allow our eligible seniors to access the guaranteed income supplement program. I deliberately discussed retroactivity in particular because I believe that if we do not include a provision in this bill to allow for retroactivity, we would simply be maintaining the same injustice, which is entirely unacceptable.

We, the Bloc Québécois, want no part of that. We encourage our colleagues of the other parties to come to their senses, to embrace justice, to embrace their sensitivity, and finally grant our seniors the right to receive their guaranteed income supplement benefits, which they should have been receiving since 1993. Thank you.

Canada Pension PlanGovernment Orders

12:30 p.m.


The Acting Speaker Conservative Andrew Scheer

Is the House ready for the question?

Canada Pension PlanGovernment Orders

12:30 p.m.

Some hon. members


Canada Pension PlanGovernment Orders

12:30 p.m.


The Acting Speaker Conservative Andrew Scheer

The question is on the motion. Is it the pleasure of the House to adopt the motion?

Canada Pension PlanGovernment Orders

12:30 p.m.

Some hon. members


On division.

Canada Pension PlanGovernment Orders

12:30 p.m.


The Acting Speaker Conservative Andrew Scheer

I declare the motion carried. Accordingly the bill stands referred to the Standing Committee on Human Resources, Social Development and the Status of Persons with Disabilities.

(Motion agreed to, bill read the second time and referred to a committee)

Sales Tax Amendments Act, 2006Government Orders

12:35 p.m.


Carol Skelton Conservative Saskatoon—Rosetown—Biggar, SK

Sales Tax Amendments Act, 2006Government Orders

12:35 p.m.


James Bezan Conservative Selkirk—Interlake, MB

Mr. Speaker, I welcome this opportunity to begin the debate at second reading of Bill C-40. This bill contains a number of amendments to update the operation of our tax system, some of which have been previously made public either by news release or by way of a notice of ways and means motion.

Before I outline the measures contained in the bill, I would first point out that the consultative process that led up to the introduction of the bill is an excellent example of successful cooperation between government and the tax and business communities toward achieving our common aim of improving our tax system. Adjustments have been made to the legislation as it was originally proposed in response to representations from both tax and business communities.

On behalf of Canada's new government, I take this opportunity to thank those interested parties who brought forward their views on the many issues addressed in the legislation. Bill C-40 reaffirms this government's commitment to making our tax system simpler and fairer not only for individual Canadians but for Canadian businesses as well.

I would like to take a moment to comment more broadly on how the legislation proposed in Bill C-40 links to this government's goal to ensure that Canada has a fair and competitive tax system.

Canada has long been recognized internationally as a country that treats its citizens fairly, which is one of the reasons that many people from all over the world come here to fulfill a dream of a better life for themselves and their families. Canada's new government believes in helping those dreams come true by creating new opportunities for Canadians wherever they live. That is why in our first budget we took action to help families and individuals as well as businesses by lowering taxes, rewarding effort and making Canada a better place in which to live and work.

One of our core priorities was to reduce taxes. We did that first by reducing the GST. We also provided other significant personal and corporate tax relief on the investments that will create jobs and boost Canada's economy by improving incentives to work, save and invest, and we are doing more.

The Minister of Finance recently announced a tax fairness plan for all Canadians. This plan will help restore balance and fairness in Canada's tax system to ensure our economy continues to grow and prosper and to bring Canada in line with our trading partners.

Families and businesses still pay too much tax in this country and our government will continue to reduce taxes for all Canadians. This new government firmly believes that a fair, efficient and competitive tax system plays a key role in creating a stronger, more productive economy. The measures contained in this bill reflect that belief. I will outline the initiatives contained in the legislation and in doing so illustrate how they support this government's goal of ensuring that we have a fair tax system.

The bill is divided into three parts. Part one mainly implements proposed measures relating to the goods and services tax and the harmonized sales tax. These measures are aimed at improving the operation of the GST-HST in the affected areas and ensuring that the legislation accords with the policy intent. Part two contains measures relating to the taxation of wine, spirits and tobacco. Part three of the bill is related to the air travel security charge.

Starting with part one, the GST-HST measures, a number of these initiatives have been previously announced by way of press release or by notice of ways and means motions. The proposed GST-HST measures in the bill fall into a number of main areas. The first is health.

An important priority for Canadians and Canada's new government is our health care system. The Government of Canada is committed to providing support to provinces and territories to help ensure that all Canadians have access to timely, quality health care. To make sure that happens, transfers from the federal government to the provinces and territories in support of health are at their highest levels ever, approximately $21.3 billion for the Canada health transfer and wait times reduction transfer.

This will ensure stable, predictable and increasing support for Canada's health care system. In addition to transfers, the Government of Canada provides some $6 billion annually in its own areas of responsibility, including first nations and veterans health, health protection, disease prevention, health related research, and medical and caregiver tax credits. The legislation contained in the bill complements these investments by helping to ensure that Canadians receive the health services they need.

For example, Bill C-40 proposes to continue indefinitely the GST-HST exemption for speech language pathology services. It also exempts health related services rendered in the practise of the profession of social work. These amendments are consistent with the government's policy criteria for inclusion of a particular health care service on the list for those that are GST-HST exempt. That is to say, if a service is rendered in the practise of a profession that is regulated as a health care profession by the governments of at least five provinces, the service is exempt in all provinces.

In addition, the bill proposes a tax free status to the sales and importations of blood substitutes known as plasma expander.

Under the current GST-HST legislation, the supply of blood and blood derivatives is tax free, whereas synthetic blood products, such as plasma expander, are not tax free as they are not of organic origin. To maintain consistency in our tax system, the proposed amendments will also ensure that blood products, such as plasma expander, receive the same GST-HST treatment as that of blood derivatives.

The bill would also restore the tax free status of a group of drugs that are commonly used to treat a variety of conditions such as seizure control, anxiety and alcohol withdrawal.

Once again, the proposed amendment in Bill C-40 would ensure consistency with the government's policy criteria of ensuring that no sales tax applies throughout the production-distribution chain in a case of federally regulated drugs that can only be sold to a consumer under a prescription.

Another GST-HST area dealt with in the bill is agriculture. The Government of Canada recognizes the vital role that farmers play in our economy. To help those hard-working Canadians, the government has established a number of tax measures and other programs that support our farmers. For example, farmers do not need to pay the GST on a list of selected major items used exclusively by farmers. This includes pesticides, feed, all fertilizer and certain farm machinery and equipment. This so-called zero related list is intended to relieve farmers of possible cash flow problems that might arise between the terms of payment of tax on high price items and the receipt of an input tax credit.

The amendments in Bill C-40 would help ensure consistency between the GST-HST treatment of different farm products that can be purchased, imported and sold by farmers on a tax free basis.

Bill C-40 also deals with GST-HST as it relates to business arrangements. Canada's new government recognizes the important role played by small businesses in our economy. After all, they are the main job creators in Canada. Accordingly, we are committed to ensuring a favourable environment that allows these businesses to prosper and expand.

I mentioned at the outset that measures in the bill result from consultations with the tax and business community.

Time does not permit me to go into all the details but suffice it to say that Bill C-40 contains a number of provisions mostly intended to simplify or clarify the GST-HST administrative requirements for businesses in Canada.

Ensuring the efficient operation of our sales tax system is important to the government. To that end, Bill C-40 contains miscellaneous housekeeping changes to sales tax legislation that update provisions, correct ambiguities or ensure consistency. As well, the bill contains GST-HST administrative amendments concerning the discretionary power under the act for the Minister of National Revenue.

Finally, three Atlantic provinces have harmonized their sales tax system with that of the federal system. Bill C-40 contains rules related to the operation of the harmonized sales tax. One such example proposes to modify the existing new housing rebate for the provincial portion of the HST in the province of Nova Scotia. As announced by the Government of Nova Scotia, this rebate will be targeted to first time homebuyers and capped at a maximum of $1,500.

As I mentioned at the outset, Bill C-40 is comprised of three parts. I will now outline the details of the second part. This section contains measures relating to the taxation of wines, spirits and tobacco.

By way of first providing some background, a comprehensive review of the federal framework for the taxation of alcohol and tobacco products culminated in new excise tax legislation. This new framework modernizes the legislative provisions governing the taxation of spirits, wine and tobacco products and introduced an updated administrative and enforcement framework that reflects current industry practices.

The proposals contained in Bill C-40 implement a number of technical amendments to the excise framework. The amendments constitute refinements that would improve operation of the legislation and more accurately reflect industry and administrative practices.

The excise legislation has also been amended to implement a minor change to bring it into compliance with the specifications of the Framework Convention on Tobacco Control, an international treaty on tobacco control sponsored by the World Health Organization.

This brings me to part three of Bill C-40 which deals with proposed amendments to the air travellers security charge.

While time does not permit me to outline all of the proposed amendments, it is important to point out that the majority of these amendments come as a result of the consultation process with interested parties. I would, however, like to describe in more detail one of the proposed amendments. This is the one that deals with an exception for the air travellers security charge for charitable flights.

Immediately after the security charge was introduced, it was brought to the attention of the previous government that certain charities arrange free air transportation services for persons who otherwise cannot afford the cost of flights for medical care, as well as “flights of a lifetime” for physically, mentally or socially challenged children.

Canada's new government has responded to these concerns with this proposed legislation. Specifically, Bill C-40 proposes that the air travellers security charge will not be payable for air travel that is donated by an air carrier at no cost to a registered charity as long as the charity donates the air travel to an individual, also at no cost, in pursuit of the charitable purpose. This measure would help charities, like the Children's Wish Foundation of Canada which is dedicated to fulfilling a favourite wish for children afflicted with a high risk, life-threatening illness.

The measures contained in Bill C-40 that I have outlined today propose to refine, streamline and clarify the application of our sales tax system. At the same time, the bill reflects this new government's commitment to ensure that our tax system is efficient and, above all, fair.

I, therefore, urge hon. members to support the bill.

Sales Tax Amendments Act, 2006Government Orders

12:45 p.m.


Larry Bagnell Liberal Yukon, YT

Mr. Speaker, I will speak in favour of two elements in the bill, the first one being the last element mentioned, which is helping poor children to go on trips of a lifetime. Who could argue against that?

The second element is the excise tax changes, particularly on breweries. We have an excellent brewery in Yukon that makes Yukon Gold, Chilkoot Amber and so on. We have been lobbying for this change for a long time and I will be strongly supporting that particular change.

Sales Tax Amendments Act, 2006Government Orders

12:45 p.m.


James Bezan Conservative Selkirk—Interlake, MB

Mr. Speaker, I, like the hon. member, am also pleased that we are moving forward in removing the excise taxes, the GST and HST that surround things like breweries and the alcohol provisions and making things a little more streamlined.

In particular, dealing with the whole issue of charitable donations of flights, the Children's Wish Foundation is a foundation that I have worked with. It does a great service for families who have children who are very sick. The foundation ensures those kids get to live out their dream by taking them to their places of fancy and fantasy and to have that enjoyment as an entire family, not just for the single kid but the entire family.

With the fundraising activities that we do in my riding we have sent many families around the world. I look forward to working with those foundations and being able to ensure the security charge is removed.